A Series of Increasingly Spurious Analogies

So I’ve been really torn about whether I should weigh in on the Dreamspinner thing because I do absolutely see both sides here. And, at the very least, I hope we can all agree that for some people not to be getting paid money they are owed by a company that owes them money is a non-ideal situation. I think a lot of acrimony that surrounds this discussion, though, comes down to whether you feel the specific circumstances that have led to some people not getting paid money they’re owed are understandable and forgivable, or utterly unethical. And the reason I decided to get involved in this is because, as far I can tell, where you stand on that spectrum depends partly, obviously, on your personal feelings about the publisher, but it also depends on your instinctive response to a deeply abstract question about economics. And if there’s one thing that I think is on-brand for this blog it’s over-analysing deeply abstract questions.

Analogy the first: you work for a mom and pop hardware shop, owned by Ma and Pa Nailerman. One day Ma Nailerman comes up to you and says, “Sorry kid, it’s been a bad month for hardware because people are being really careful and not breaking stuff at the moment so we’re going to have to put off paying you this month.” Now probably you wouldn’t be overjoyed because, well, you’re unlikely to be selling rivets for the love of it and you expect to get paid for it at some point. But you might also understand where Ma and Pa Nailerman are coming from. It’s tough being an independent hardware retailer these days, what with all the competition from Big Screw, and they’re good people, and they let you take an extra day off that one time for your cat’s birthday so you might suck it up. Besides, you know they’re good for it and if there ever comes a point when they’re not good for it they’ll have bigger problems than you will.

Of course, if it happened again, and if it kept happening, you might eventually decide that you have to move out of your minimum wage shop floor job and start looking for slightly more stable employment. But you wouldn’t think anything bad about the Nailermans. You’d know they did their best. You’d probably blame the economy. You might even blame whichever political party you didn’t vote for.

Analogy the second: you wait tables at Ma and Ma Cookerson’s Non-Heteronormative Family Diner. One day, Ma Cookerson takes you aside and says, “Sorry kid, it’s been a bad week in the family dining business so we can’t afford to pay you but we’ll make it up to you next time.” And, again, you’d probably roll with it, for all the same reasons you did last time, since the Cookersons are just as nice as the Nailermans. But suppose then she was to add, “Also, we’re keeping your tips.” And she’d quickly go on to explain that they’d write down how much you made in tips and they would add that to what they paid you back when they could afford to but you’d no longer be working with the assumption that whatever money a customer gave you was yours.

You might feel a little bit worse about that. What’s weird is, you might feel worse about that even if the next reduction in your income was the same as you had when you working for the Nailermans (after all, my understanding is that, in the US at least, minimum wage laws don’t apply to wait staff precisely because tips are factored into their income). What makes the difference here isn’t the amount of money that’s being withheld. It’s the understanding you’d previously had about how money was to be divided. When you get a job waiting tables (and, actually, this varies a lot, and the way tips are distributed is very different in different places but this is an analogy so stick with me) the deal is: what the customer pays for the food goes to the restaurant, and what they leave as a tip goes to you, and there is a meaningful difference between your employer withholding your wages because they can’t afford to release those funds and them taking away money that, by your understanding of the terms of your employment, should already be yours.

Analogy the third: after your understandable but financially detrimental experiences in various ends of the customer service industry you decide to start growing lemons. Why you decide to do this, I’m not sure. Just go with it. You make a deal with the aptly named Mr Lemonseller. He offers you the following bargain: you will grow the lemons, and he will sell the lemons, and you will split the proceeds from the sale of the lemons 30/70. And this works fine for a while. But then one day Mr Lemonseller comes back and tells you that he has sold all of the lemons but his transport and accommodation costs were much higher than expected due to fluctuating oil prices and an unforeseen Ariana Grande concert. Thus, he informs you, that although he did sell the lemons, he had to spend some of your half of the lemon money to cover his expenses.

This you might reasonably be much more pissed off about. Because you had a very specific deal with this man. You do your bit of your job (growing and producing the lemons), he does his bit of the job (transporting and selling the lemons), and it’s up to each of you individually to make your bits of that process worth it. You don’t, after all, get to ask Mr Lemonseller to give you more money just because the price of fertiliser went up or the state has introduced a new tax on the colour yellow. Effectively Mr Lemonseller has exploited the fact that, because he is the one who handles the money, it is much easier for him to pass his costs onto you than it is for you to pass your costs onto him. Now it’s possible that you’ll still be okay with this deal. You might really like Mr Lemonseller. You might even find that you make more money working with Mr Lemonseller, despite the fact that he occasionally dips into your cut of the lemon money, than you would with somebody else. Because maybe Mr Lemonseller is fantastically good at selling lemons. But if that’s the case, you’d probably be more comfortable re-negotiating your deal so that Mr Lemonseller is upfront about what percentage of the lemon money he actually takes rather than just accepting a situation where sometimes you don’t get money that definitely exists and you are definitely owed.

Now I appreciate that the way I’ve structured this rhetorical device deliberately leads the reader to see the situation under discussion as more like the last example then the first. And I do happen to believe that the Mr Lemonseller model is a better way to think about the relationship between an author and a publisher than the hardware store or the hybrid-model of wait staff salary plus tips. But I also understand that there are people for whom the first analogy is the most apposite one. There are people for whom working for Dreamspinner is like working for Ma and Pa Nailerman who are currently having trouble because Amazon suddenly starting offering customers unlimited hammers. I do get that. I really do.

But having thought about this, as I usually do way too much, the thing that keeps coming back to me about the Lemons Analogy is the fertiliser / travel costs thing. If you work a job for a salary there is an understanding that you are strongly insulated from the uncertainties inherent in the business you work for. And, perhaps paradoxically, that makes it easier to accept the rare occasions on which the uncertainties inherent in the business impact you – because you know for it to have got to that point things must have gone very, very badly. But if someone is selling your lemons (or, obviously, in this case your books) then you are already assuming much more of the risk of their doing business. You’re effectively more of an investor than an employee. If Mr Lemonseller breaks his ankle and can’t sell lemons for three months, that’s your income gone. And so if Mr Lemonseller also then asks you to help cover his medical fees you’ve effectively been double impacted by his misfortune. And, maybe, you are better off paying those medical fees in order to keep Mr Lemonseller in the lemon-selling business because otherwise you’ve got no way to sell your lemons but is it fair for Mr Lemonseller to be asking you to do that in the first place?

And, again, I should stress that for some people the answer is yes. Some people will be profoundly grateful to Mr Lemonseller for getting them started in lemon-selling. But from a strict standpoint of business ethics your deal with Mr Lemonseller is very clear: you get 30% of the money, and he gets 70% the money, and he does not get to decide what’s done with your 30% of the money. Even if the thing he’s doing is going to make him better at selling lemons in the long run. Because if Mr Lemonseller is allowed to take some of your lemon money and re-invest it in his lemon business he’s effectively asking you to assume risks your never signed up to assume for rewards that will benefit you substantially less than they’ll benefit him. If he takes your lemon money and uses it to buy cantaloupes, sells the cantaloupes at a profit, then uses the cantaloupe money to invest in a better fruit stall that might long-term lead to your selling more lemons, and therefore getting a larger lemon-based income, but short-term you had to subsidise his capital investment. And you, after all, do not own the fruit stall.

On top of which, once again, you have no means to treat him equivalently. If you break your ankle, and therefore cannot produce any lemons, he has to get his lemons from somewhere else but you can’t make him give you some of the money he makes from selling someone else’s lemons to cover your medical expenses. If you want to buy a deluxe lemon-harvesting machine you can’t unilaterally do that with his percentage of the lemon money because you never have possession of it. So he can make investments with your money, but you can’t make investments with his money. And, to a lot of people, the only ethical way for this relationship to be managed that doesn’t create genuine moral hazards for the Mr Lemonsellers of the world—who could be very easily tempted to re-invest your lemon money in the reasonable certainty that they’ll make it back before you notice it’s gone—is to have a rigorous system in place to make sure that cannot happen.

The thing is, I completely see why some people view their relationship with a publisher differently. Especially if you’re used to working a more conventional job (and, frankly, virtually everybody is more familiar with conventional jobs than they are with weird, rights-based industries unless you’ve always been a novelist, and you’re married to a novelist, and your parents are novelists) it’s natural to think of the company who sends you money every few months as your employer and yourself as effectively their employee. But that isn’t actually an author’s relationship with their publisher. You have a deal with them, in which you make stuff, and they sell it, giving you a share of the profits. And, by my very limited understanding of contractual law, those profits become yours at the point of sale.

For some people, this doesn’t matter. Some people are perfectly comfortable seeing their royalties as a sort of variable salary that the company pays from an undifferentiated pot of money, and they accept that if the pot is running low, not everybody is going to get to take money out of it every month. But for other people the existence of the pot of money system highlights a structural flaw in the way the company has hitherto set up its finances. Just as I would expect Mr Lemonseller on selling my lemons to set aside my part of the money lemon, and not touch it because it’s not actually his, just as I would expect the Cookerson’s to let me keep my tips even if they couldn’t afford to pay me my salary, I would, on reflection, expect a publisher to do the same with my royalties. Because the deal we have is not that I get given a variable amount of money depending on how well the publisher is doing at the moment, the deal is that I get a certain percentage of the revenue generated from the sales of a product that I have produced.

I’m in kind of an odd position in that I find myself having quite a strong opinion about a contentious current issue based entirely on my opinions about a completely abstract issue that I didn’t even consider until the contentious issue cropped up. The truth is, that payments, of any kind, are rather like, I mean pick whatever example leaps out to you because there are hundreds, many of them biological, in that you don’t really notice until it stops working. I think what I’m groping towards here is that I now hold quite firmly to the position that it is correct practice for publishers to earmark royalties and not touch them (see above: re Mr Lemonseller and his moral hazards) and that a publisher not doing this would be a problem even if it was still managing to pay its authors. And I suspect part of the problem here is that if you don’t agree with that principle, then the current state of affairs looks very different because there is a huge and important distinction between an unfortunate situation that ultimately couldn’t have been avoided, and an unfortunate situation that should never have been possible.

Before I wrap up and sign off, there’s one more way of articulating this that might help people see where those of us who have a problem with the structures that have led to all these difficulties are coming from. Because, on reflection, you can make a case that the deal an author has with their publisher is essentially the same as the deal an author has with their agent. Which is to say, you sell my shit, and we split the money. Now, of course, in the case of an author-agent relationship the split is very much more in the author’s favour, but if my agent turned round to me and told me that they’d kept my share of the royalties this time round for any reason I would, meaning no disrespect, lose my motherfucking shit. And I don’t think single person would have a problem with that because it makes intuitive sense that the money I receive from my agent is definitely my money and not only does my agent not have the right to withhold a penny of it they have a professional obligation to set it aside to give it to me within the timeframe we’ve agreed upon.

But, or some reason, when it’s the same situation with a publisher it all feels … wobblier somehow, probably because it’s no longer an individual lemon seller you’re dealing with, so much as a distributed lemon-selling network.  From my perspective, though, the principle is the same. You may, of course, feel differently about your lemons and that’s fine, this is a complex situation and there are no easy answers, especially when you get into questions of how people’s responses to the practices of a business impact people whose livelihoods depend on that business. I mean, ultimately we all care about lemons, and are just trying to make lemonade as best we can.


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